Quarterly financial report for the quarter ended June 30, 2021
This quarterly report has been prepared by management as required by section 65.1 of the Financial Administration Act and in the form and manner prescribed by the Treasury Board. This report should be read in conjunction with the Main Estimates, the Supplementary Estimates and the previous Quarterly Financial Reports.
A summary description of the Parks Canada Agency's programs can be found in Part II of the Main Estimates, and a detailed description in Part III – Departmental Plans.
This quarterly report has not been subject to an external audit. However, it has been reviewed by the Agency's Audit Committee.
1.1 Basis of presentation
This quarterly report has been prepared using an expenditure basis of accounting (modified cash accounting). The accompanying Statement of Authorities includes the Parks Canada Agency's spending authorities granted by Parliament and those used by the Agency consistent with the Main Estimates and Supplementary Estimates A for the 2021-22 fiscal year. This quarterly report has been prepared using a special purpose financial reporting framework designed to meet financial information needs with respect to the use of spending authorities.
The authority of Parliament is required before moneys can be spent by the Government. Approvals are given in the form of annually approved limits through appropriation acts or through legislation in the form of statutory spending authority for specific purposes.
The Agency uses the full accrual method of accounting to prepare and present its annual departmental financial statements that are part of the department performance reporting process. However, the spending authorities voted by Parliament remain on an expenditure basis.
2. Highlights of fiscal quarter and fiscal year to date results
2.1 Statement of Authorities (Table 1)
Authorities available for use
This quarterly report reflects the funding available for use from the 2021-22 Main Estimates, the 2021-22 Supplementary Estimates A, and the 2020-21 unused spending authorityFootnote 1. The authorities at the same time last year consisted of 2020-21 Main Estimates, the 2020-21 Supplementary Estimates A, and the 2019-20 unused spending authority.
At June 30, 2021, Parks Canada's total authorities available for use for the year ending March 31, 2022, are $12.0 million or 1% higher when compared to the same quarter of the previous year (from $1,384.6 million to $1,396.6 million). This increase in authorities is primarily due to the following factors:
- An increase of $44.7 million in spending authorities related to the Youth Employment and Skills Strategy (YESS);
- An increase of $23.0 million due to ratification of collective agreement;
- An increase of $8.8 million in 2020-21 unused spending authorities (included in the opening balance of the 2021-22 authorities) as compared to 2019-20 unused spending authorities (included in the opening balance of the 2020-21 authorities);
- An increase of $77.4 million considering the fact that the authorities available for use in the first quarter of 2020-21 were lower by $77.4 million due to the reduced supply of the 2020-21 Main Estimates. Due to the Covid-19 pandemic and limited sessions in the spring of 2020 for Parliament to study supply, the full supply of 2020-21 Main Estimates was not received until December 2020;
- A net decrease of $142.1 million in spending authorities related to the infrastructure investments.
Authorities used during the quarter
In the first quarter of 2021-22, total net budgetary expenditures were $203.1 million compared to $185.1 million reported for the same period in 2020-21, resulting in an increase of $18.0 million or 10 percent. The increase in authorities used during the quarter is primarily related to an increase in personnel expenditures due to revised salary rates and retroactive salary payments as a result of ratification of the collective agreement as well as a general increase in expenditures as the Agency's operations begin to recover from the impact of the COVID-19 pandemic. The increase is offset by a decrease in spending authorities related to the infrastructure investment program.
2.2 Budgetary expenditures by standard object (Table 2)
Planned by standard object
Total planned expenditures for the year ending March 31, 2022, are $12.0 million or 1 percent higher compared to the previous year. This variance is primarily due to an increase in unused spending authorities from the previous fiscal year, an increase in spending authorities related to the Youth Employment and Skills Strategy (YESS) and an increase in spending authorities due to ratification of collective agreement. Also, authorities available for use in the first quarter of 2020-21 were comparatively lower due to the impact of the COVID-19 pandemic and its effect on reduced 2020-21 Main Estimates supply. Those increases are offset by a decrease in spending authorities related to the infrastructure investments.
Expended by standard object
As per Table 2 (Budgetary expenditures by standard object), the total expended in the first quarter ending June 30, 2021, is $18.0 million or 10 percent higher compared to the previous year. The overall increase is explained by increased personnel expenditures due to revised salary rates and retroactive salary payments. The following areas also contributed to the increase:
Transfer payments increased by $4.6 million or almost triples when compared to the same quarter of last year. This comparative increase in quarter one of 2021-22 is primarily because the pandemic caused delays in 2020-21 that prevented transfer payment recipients from implementing and delivering on projects, at the same pace as planned. In addition, a new initiative in this fiscal year for work placements through the Youth Employment and Skills Strategy have increased transfer payments in the first quarter of 2021-22.
In addition, compared to the same quarter last year, expenditures in utilities, materials and supplies have increased by $2.8 million or 52%, and Acquisition of machinery and equipment have increased by $1.8 million or 53%. These increases are primarily due to the impacts of the COVID-19 pandemic on the Agency's operations since there was a general slowdown in operational activities during the temporary suspension of visitor services in all Parks Canada places for the first quarter of 2020-21. The first quarter of 2021-22 has seen a return to operations and services while following provincial/territorial safety practices and restrictions.
3. Risks and uncertainties
The Agency undertakes a corporate risk assessment every year to support programs, priority setting and resource allocation. The risk assessment identifies key corporate risks that have the greatest impact on the Agency's ability to deliver its Core Responsibility and achieve Departmental Results. The Agency has identified the following key corporate risks for 2021-22:
Environmental forces adaptation and response:
Due to the magnitude and rapid pace of environmental changes, including climate change, there is a risk that the integrity of ecosystems, cultural resources and infrastructure cannot be maintained or improved which may lead to Parks Canada being unable to deliver its mandate.
Relationships with Indigenous peoples:
If Parks Canada does not allocate the necessary time, effort and investment to build and maintain relationships with Indigenous peoples, there is a risk that the Agency may not be able to fulfill its obligations and deliver on its programs and services, which may result in damaged reputation, increased litigation and challenges meeting conservation targets.
Built asset condition and long-term sustainability:
Due to aging infrastructure, inadequate level of recapitalization and maintenance, climate change and inflationary impacts, there is a risk that Parks Canada will not be able to maintain a sustainable asset portfolio which may result in compromised public safety, loss of irreplaceable cultural heritage, and damage to the Agency's reputation.
If the Agency does not respond to changing socio-economic conditions and other market influences, there is a risk that Parks Canada's programs and services may not meet the expectations of Canadians which may lead to a decrease in Agency relevance as measured by a decrease in tourism market share and visitation.
If the Agency does not modernize its corporate and internal services, there is a risk that Parks Canada may not have the capacity, business processes and tools to effectively and efficiently support service delivery and meet government management accountability expectations.
Workforce, Equity, Accessibility, Inclusion and Diversity, and Well-Being
If the Agency fails to foster an inclusive and barrier-free work environment that reflects Canada's diverse population, there is a risk that it may no longer be an employer of choice and will lack the perspective needed to serve all Canadians, which may result in impacts on programs and services, and damage the Agency's reputation.
Parks Canada's priority, as it manages through the pandemic, is the health and safety of its employees, visitors and all Canadians. Parks Canada continues to follow public health measures (social distancing, restriction on indoor and group activities, travel restrictions) and to monitor efforts to flatten the curve and progress regarding vaccinations with a view to being ready, as appropriate, to adjust operations.
The pandemic continues to impact the Agency's financial situation, particularly its ability to generate revenue, which represents 25% of its on-going operational budget. Funding has been approved to partially compensate the Agency for revenue shortfalls it experienced for the period of April 1st to September 30, 2021. The Agency will access this funding in the future Supplementary Estimates. The Agency is continuing to monitor the potential risk of revenue decreases for the remaining of the fiscal year and is working with central agencies on strategies to mitigate this risk.
The Agency is committed to continue to work with Indigenous partners, lessees and operators, local communities, other federal departments and provincial and territorial governments as it manages through the pandemic.
4. Significant changes in relation to operations, personnel and programs
On April 1st 2021, the Agency transitioned from a multi-year appropriation to a one (single) year appropriation regime.
5. Approval by senior officials
President & Chief Executive Officer,
August 26, 2021
August 16, 2021
Parks Canada Agency
For the quarter ended June 30, 2021
Statement of Authorities - Table 1
|Fiscal Year 2021-22|
|(in thousands of dollars)||Total available for use for the year ending March 31, 2022 Footnote *||Used during the quarter ended June 30, 2021||Year to date used at quarter-end|
|Vote 1 - Program expenditures||1,181,309||147,424||147,424|
|Vote 5 - Payments to the New Parks and Historic Sites Account||7,371||0||0|
|Statutory - Contributions to employee benefit plans||57,867||13,709||13,709|
|Statutory - Expenditures equivalent to revenues resulting from the conduct of operations pursuant to section 20 of the Parks Canada Agency Act||150,000||41,977||41,977|
|Total budgetary authorities||1,396,547||203,110||203,110|
|Fiscal Year 2020-21|
|(in thousands of dollars)||Total available for use for the year ending March 31, 2021 Footnote *||Used during the quarter ended June 30, 2020||Year to date used at quarter-end|
|Vote 1 - Program expenditures||1,153,026||168,226||168,226|
|Vote 5 - Payments to the New Parks and Historic Sites Account||7,494||0||0|
|Statutory - Contributions to employee benefit plans||54,063||12,222||12,222|
|Statutory - Expenditures equivalent to revenues resulting from the conduct of operations pursuant to section 20 of the Parks Canada Agency Act||169,993||4,611||4,611|
|Total budgetary authorities||1,384,576||185,059||185,059|
Parks Canada Agency
For the quarter ended June 30, 2021
Budgetary Expenditures by Standard Object - Table 2
|Fiscal Year 2021-22|
|(in thousands of dollars)||Planned expenditures for the year ending March 31, 2022 Footnote *||Expended during the quarter ended June 30, 2021||Year to date used at quarter-end|
|Transportation and communications||51,829||1,282||1,282|
|Professional and special services||218,290||14,995||14,995|
|Repair and maintenance||62,952||3,830||3,830|
|Utilities, materials and supplies||97,420||8,272||8,272|
|Acquisition of land, buildings and works||310,250||25,742||25,742|
|Acquisition of machinery and equipment||35,465||5,213||5,213|
|Public debt charges||0||21||21|
|Other subsidies and payments||28,040||1,011||1,011|
|Total budgetary expenditures||1,396,547||203,110||203,110|
Parks Canada Agency
For the quarter ended June 30, 2020
Budgetary expenditures by standard object - Table 2
|Fiscal Year 2020-21|
|(in thousands of dollars)||Planned expenditures for the year ending March 31, 2021Footnote *||Expended during the quarter ended June 30, 2020||Year to date used at quarter end|
|Transportation and communications||35,315||974||974|
|Professional and special services||248,704||19,571||19,571|
|Repair and maintenance||68,469||3,930||3,930|
|Utilities, materials and supplies||111,290||5,425||5,425|
|Acquisition of land, buildings and works||372,163||38,577||38,577|
|Acquisition of machinery and equipment||46,481||3,397||3,397|
|Public debt charges||0||25||25|
|Other subsidies and payments||27,712||1,212||1,212|
|Total budgetary expenditures||1,384,576||185,059||185,059|
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